The stock of KRBL had gained 6.3 per cent accompanied by extraordinary volume on Wednesday decisively breaking above a key resistance at ₹220 levels. This rally provides traders with a short-term perspective an opportunity to buy the stock at current levels. In December 2020, the stock met with a key resistance at around ₹290 and was on a medium-term downtrend until it found support in the band between ₹170 and ₹180 in March this year.
Thereafter, the stock moved sideways and this support cushioned the stock until late April. After forming a falling wedge pattern which acts as a bullish reversal pattern in this scenario, the stock changed direction. Triggered by positive divergence in the weekly relative strength index the stock changed direction. Since late April, the stock has been in a budding short-term uptrend.
It surpassed key resistances at ₹200 in early May and then ₹220 in the last trading session. The daily relative strength index features in the bullish zone and the weekly RSI is featuring in the neutral region with an upward bias. The short-term outlook is bullish for the stock of KRBL. It can extend the up-move and reach the price targets of ₹242 and ₹248 in the coming trading sessions. Traders with a short-term view can buy the stock with a stop-loss at ₹227.
(Note: The recommendations are based on technical analysis. There is risk of loss in trading.)